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USDA Supply and Demand Report to be Issued Later Today

This report should be a non-event as no production survey based data will be included

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Grains were higher overnight going into the December USDA Supply and Demand Report. In outside markets, the US dollar sunk to its lowest level in three trade sessions, lifting crude oil futures. S&P futures were modestly lower.

Today’s USDA report is expected to be a non-event as there are no production survey based data in this report. The final US production numbers will come in the January report. Ending stocks are expected to be revised slightly higher in corn and wheat as some cut in export forecasts could be in the cards.

US Ending Stocks (in million bushels)

Expected Range Nov USDA

Corn 1,768 1,640-1,810 1,760

Soybeans 462 445-478 465

Wheat 918 910-936 911

Overnight, Ukraine's agriculture ministry has raised its forecast for the 2016 grain harvest to more than 61 MMT compared with an earlier forecast of 60.5 MMT. He pointed to improved weather supporting the wheat crop. “A few weeks ago more than 30 percent of the crop was in a poor state while now the acreage of poor crop is not more than 17 percent," he said.

The US dollar reversed direction from the previous two sessions, hitting a 3-session low following Thursday’s major sell off. Crude oil was moving higher overnight as Chinese CPI surprised to the upside, but deflationary pressures persist with producer prices falling for a 45th consecutive month, weighing on shares in Asia. A much stronger than expected jump in machinery orders out of Japan also supported crude.

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a dba of Foremost Trading LLC (NFA ID: 0307930)

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